FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 10: Fundamentals of Investing

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 51

Multiple Choice

Review LaterAdd Note

Review Later

Your investment suddenly goes down 15 percent one month after you invest. Its fundamentals still look good. What would you do if you were a very risk tolerant investor?

A) Hold on and wait for it to come back.
B) Buy more. If it looked good at the original price, it looks even better now
C) Sell it to avoid losing even more
D) Sell and then buy if it goes down again
E) sell and buy GICs

F) B) and E)
G) C) and E)

Correct Answer

verified

Show Answer

Question 52

Multiple Choice

Review LaterAdd Note

Review Later

Which of the following is not a determinant of investor risk tolerance?

A) goals and time frames
B) economy
C) income and asset base
D) personality
E) income

F) A) and E)
G) A) and D)

Correct Answer

verified

Show Answer

Question 53

True/False

Review LaterAdd Note

Diversification of assets among several types of investments can increase risk.

A long-term objective may take more than five years to accomplish.

Derivatives are securities such as options, and forward and futures contracts, whose value depends on the performance of an underlying security.

After graduating from university, you obtain a job as a medical records technician. Your monthly salary is $2,000. Your monthly expenses are $1,600. Based on this information, what steps should you take to establish a long-term investment program?

Define what an emergency fund is and describe its function. If your income is $20,000 per year and living expenses are $1,500/month, how much money should be in the fund?

An emergency fund should be deposited in a

An intermediate-term objective is defined as one that will be accomplished within eighteen months.

When investing in global investments, changes in the currency exchange rate may affect the return on your investment.

Mutual funds range from very conservative to extremely speculative investments.

Generally, options are not long-term investment techniques.

A designated financial planner has had at least two years of training in securities, insurance, taxes, real estate, and estate planning and has passed a rigorous examination.

A decrease in the value of stocks, bonds, or other investments may cause investors to experience ____________ risk.

The fees for investor services and newsletters generally range from ____________ a year.

A long-term objective may take up to three years to accomplish.

A short-term investment objective is defined as one that will be accomplished within a period of less than two years.

If interest rates in the overall economy increase, what will happen to the market value of a corporate bond with a fixed interest rate?

The potential return of any investment should be directly related to the risk that the investor assumes.

A corporation selling stock is obligated to